Govt probing complaints in mega combat aircraft deal

February 06, 2014 16:33 IST

The government is looking into the complaints about the procedure to determine the winner of the multi-billion dollar combat aircraft deal, Defence Minister A K Antony said on Thursday while admitting that there was no money to sign such a big deal in this fiscal.

"There are complaints about the procedure of calculating the life cycle cost and that issue is not yet settled. Before bringing the deal before the cabinet committee on security for the final approval, we would like to get clear on that aspect," he told a press conference in New Delhi.

Antony hoped that deal will be finalised in 2014-15.

French Rafale fighter aircraft has been the lowest bidder in the medium-multi-role combat aircraft deal, which is touted as the "mother of all deals" and is expected to cost India more than Rs 60,000 crore.

As per the Indian defence procedure, the firms offering lowest prices and meeting the requirements of the respective services are given the contract and in this deal to procure 126 combat aircraft, the LCC has been taken into view to determine the lowest bidder.

Senior Bharatiya Janata Party leader and former finance minister Yashwant Sinha has written to Antony raising a number of questions over the "conceptual shift" in the defence procurement policy and expressed fears that the LCC concept may bring in corruption.

Asserting that the negotiations in the deal were still progressing, the defence minister said the financial condition of the government was not good and "there is no money for this."

"Almost all the budget has been spent. Many other projects are also in the pipeline," he said.

Asked whether the government would buy more Su-30MKI combat aircraft from Russia if the deal with the French aircraft manufacturer does not fructify, Antony expressed hope that, "The M-MRCA will materialise next year."

He said the government was making headway in the deal and taking all the possible care in the process to ensure that there are no loose ends in the "mother of all deals".

After a five-year long process, India had selected the French Dassault Aviation last year for meeting its requirement for 126 combat aircraft edging out the European consortium EADS' Eurofighter Typhoon fighter jet.

The defence minister said his department has already spent 92 per cent of its funds allocated for modernisation and the remaining is also expected to be utilised soon.

Image: French Rafale fighter aircraft has been the lowest bidder in the medium-multi-role combat aircraft deal